1. Claim for accidental death insurance cover under complimentary scheme for police personnel denied by bank. (Para 1 , 2 , 3 , 4 , 12 )
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2026 Supreme(Online)(UK) 1027
Pankaj Purohit, J
Damyanti Negi – Appellant
Versus
State Of Uttarakhand – Respondent
Write Petition Misc. Single No. 2446 of 2022
Important Points
An administrative lapse or failure to include a name in a coverage list cannot defeat the legitimate entitlement of a beneficiary under a complimentary insurance scheme, especially when the eligibility criteria were met and the premium was to be borne by the provider.
Subject
Civil - Insurance Law
Act Referred
Headnote
(A) Insurance Schemes - Administrative Lapses - Denial of benefit based on non-inclusion in a list - Where a scheme is intended for a specific category of employees (police personnel with salary accounts) and the premium is borne by the institution, an administrative omission in listing a qualified employee cannot be used to deny the legitimate claim of the legal heirs. (Para 12)
(B) Article 14 of the Constitution of India - Arbitrariness - Denial of benefits to similarly situated individuals - Denying insurance cover to a qualified employee while extending it to others, on the ground of a clerical error or lack of coordination between departments, is arbitrary and violative of the right to equality. (Para 13)
Issues: Whether the petitioner can be denied the benefit of the accidental death insurance cover solely on the ground that the name of the deceased employee was not included in the list prepared for the scheme.
(B) Article 14 of the Constitution of India - Arbitrariness - Denial of benefits to similarly situated individuals - Denying insurance cover to a qualified employee while extending it to others, on the ground of a clerical error or lack of coordination between departments, is arbitrary and violative of the right to equality. (Para 13)
Issues: Whether the petitioner can be denied the benefit of the accidental death insurance cover solely on the ground that the name of the deceased employee was not included in the list prepared for the scheme.
Legal Category Hierarchy
- administrative law
- constitutional law
- practice and procedure
Advocates:
For the Appellants/Petitioners: M.K. Ray, Harsh Taneja
For the Respondents: Suyash Pant, M.S. Rawat
For the Appellants/Petitioners: M.K. Ray, Harsh Taneja
For the Respondents: Suyash Pant, M.S. Rawat
Table of Contents
2. Bank denied claim due to non-inclusion in list; petitioner argued automatic coverage for salary account holder police personnel. (Para 5 , 6 , 7 , 8 , 9 , 10 , 11 )
3. Omission to include deceased in list is an administrative lapse; beneficiary cannot suffer for inter-departmental coordination failure. (Para 12 , 13 )
4. An insurer cannot deny a gratuitous or complimentary insurance benefit due to its own administrative omission or lack of coordination. (Para 12 , 13 )
5. Writ allowed; impugned communication set aside; bank directed to pay insurance cover amount with interest. (Para 14 , 15 )
6. Can a beneficiary be denied a complimentary insurance benefit due to the bank's administrative lapse in including the insured's name?
No. The beneficiary cannot be made to suffer for an administrative lapse or lack of coordination between the bank and the police department. (Para 12 , 13 )
7. Is the bank's lack of knowledge of the deceased's status a valid defense for denying coverage?
No. The bank cannot plead lack of knowledge when the deceased's salary was regularly credited and a loan was sanctioned against that account. (Para 13 )
8. Is the denial of a benefit under a scheme to one while extending it to similarly situated employees arbitrary?
Yes, such differential treatment without justification is arbitrary and violates the constitutional guarantee of equality under Article 14. (Para 13 )
9. What is the nature of a ‘complimentary’ insurance scheme where the bank bears the premium?
It is an automatic, gratuitous benefit for eligible account holders, not requiring a separate application or nomination from the insured. (Para 5 , 12 )
By means of the present writ petition filed under Article 226 of the Constitution of India, the petitioner seeks issuance of a writ of certiorari for quashing the impugned communication dated 21.05.2022 issued by the respondent-bank, whereby the claim of the petitioner for grant of accidental death insurance cover has been declined, and further seeks a writ of mandamus commanding the respondents to release an amount of Rs.25,00,000/- in favour of the petitioner under the “Complimentary Police Accidental Death Insurance Cover” scheme on account of death of her husband Late Narendra Singh Negi.
2. The facts, in brief, as borne out from the record are that the petitioner is the widow of Late Narendra Singh Negi, who was serving as a constable in the Uttarakhand Police Department and was on deputation with the State Disaster Response Force (SDRF) on the post of driver. It is not in dispute that Late Narendra Singh Negi died in a road accident on 07.08.2021 during the course of his service. A death certificate to this effect forms part of the record. The deceased left behind the petitioner and three daughters, namely Km. Anjali Negi, Km. Arpita Negi and Km. Aradhya Negi, who are his legal heirs. A succession certificate has also been placed on record. It is further borne out that the deceased was maintaining a salary account bearing No. 76009501185 with the respondent No.2 –Uttarakhand Gramin Bank, Branch Rajpur Road, Dehradun, wherein his salary was regularly credited since the year 2015. It is also not disputed that a loan had been sanctioned by the respondent-bank to the deceased, the instalments of which were being deducted from the said salary account.
3. The respondent-bank introduced a scheme known as “Complimentary Police Accidental Death Insurance Cover”, which came into effect from 12.04.2021, intended to provide accidental death insurance cover to police personnel whose salaries were being disbursed through accounts maintained with the bank. As per the material on record, the premium of the said policy was to be borne by the bank itself.
4. After the death of her husband, the petitioner made representations to the respondent-bank seeking grant of benefit under the aforesaid scheme. However, the respondent-bank, vide letter dated 06.01.2022, informed the petitioner that her husband's name was not included in the list of employees covered under the scheme. Thereafter, a legal notice dated 29.04.2022 was served by the petitioner demanding payment of Rs.25 lakhs under the insurance cover, to which a reply dated 21.05.2022 was furnished by the bank reiterating its stand. Aggrieved by the denial of the benefit under the said scheme, the petitioner has approached this Court by way of the present writ petition.
5. Learned counsel for the petitioner submits that the action of the respondent-bank in denying the benefit of the insurance scheme to the petitioner is wholly arbitrary, illegal and violative of Articles 14, 16 and 21 of the Constitution of India. It is contended that the deceased was admittedly a police employee, whose salary account was being maintained with the respondent-bank since the year 2015, and therefore he squarely fell within the category of employees for whom the scheme was introduced. It is further argued that the scheme was automatic in nature and did not require any separate application or nomination, particularly when the premium was being borne by the bank itself.
6. Learned counsel for the petitioner also submits that once the scheme came into force on 12.04.2021, the deceased stood covered under the scheme by virtue of being a salary account holder of the respondent-bank, and any omission on the part of the bank or the police department in not including his name in the list cannot defeat the legitimate entitlement of the petitioner. It is further argued that the respondent-bank was fully aware of the status of the deceased as a police personnel, as not only was his salary being credited into the accou
